=Seagate Technology (STX) reported earnings on Tue 24 Jan 2017 (a/h)

Disk drive maker Seagate Technology (STX) late Tuesday reported quarterly earnings that easily topped Wall Street views on the bottom, with the top line also coming in better than expected. Seagate also gave bullish revenue guidance.

Seagate reported revenue of $2.9 billion. That's down 3% from the year-earlier quarter, but that's is smallest percentage decline in nearly two years and it beat the consensus estimate of $2.82 billion. It reported earnings per share minus items of $1.38, up 68% and well above the consensus of $1.08, for its fiscal second quarter ended Dec. 30.

On the post-earnings call, Seagate said it sees current Q3 revenue of about $2.7 billion vs. views for around $2.6 billion. It also expects full-year EPS of "at least $4.50" vs. Wall Street's forecast for $3.77.

Seagate and Western Digital, as the two largest providers of disk drives, have for several years been dealing with lower product demand as consumers shift from desktop PCs to smartphones and tablets.

Both companies have been expanding into chip-based storage, with Western Digital being the most aggressive. Western Digital in May completed its $16 billion acquisition of flash storage provider SanDisk, creating a formidable competitor in both disk drives and flash-chip storage.

Seagate approved a quarterly cash dividend of 63 cents per share, which will be payable on April 5, to shareholders of record as of the close of business on March 22.

• Q3 retail sales grew 13 percent in constant currency, reaching the highest level ever in the Company’s history. Q3 retail sales grew 12 percent in USD.
• Q3 sales were $667 million, up 7 percent compared to Q3 of the prior year, which still included OEM sales.
• Q3 GAAP operating income grew 41% to $96 million, compared to $69 million a year ago. Q3 GAAP earnings per share (EPS) were $0.59, compared to $0.41 a year ago.
• Q3 non-GAAP operating income grew 34% to $99 million, compared to $74 million a year ago. Q3 non-GAAP EPS grew 37% to $0.56, compared to $0.41 a year ago.
• Cash flow from operations for the first nine months of Fiscal Year 2017 was $234 million, compared to $151 million for same period a year ago.